Fair Value Measurements

3 Months Ended

Mar. 31, 2024

Financial Assets

The following tables provide the financial assets measured at fair value on a recurring basis:


	Amortized Cost or Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses Less Than 12 Months		Gross Unrealized Losses More Than 12 Months		Fair Value Hierarchy as of March 31, 2024						Aggregate Fair Value
									Level 1		Level 2		Level 3
Financial Assets:	(In thousands)
Cash and cash equivalents:
Money market funds	$	447,629	$	—	$	—	$	—	$	447,629	$	—	$	—	$	447,629

Commercial paper	13,036		—		—		—		—		13,036		—		13,036
Total included in cash and cash equivalents	460,665		—		—		—		447,629		13,036		—		460,665
Marketable securities:
Debt securities:
U.S. Treasury securities	437,581		331		(665)		(549)		436,698		—		—		436,698
Non-U.S. government securities	68,549		23		(20)		(463)		68,089		—		—		68,089
Corporate debt securities and commercial paper	2,651,283		6,442		(9,711)		(2,731)		14,690		2,630,593		—		2,645,283
Total debt securities	3,157,413		6,796		(10,396)		(3,743)		519,477		2,630,593		—		3,150,070
Equity securities	3,935		—		—		—		3,935		—		—		3,935
Total marketable securities	3,161,348		6,796		(10,396)		(3,743)		523,412		2,630,593		—		3,154,005
Total financial assets	$	3,622,013	$	6,796	$	(10,396)	$	(3,743)	$	971,041	$	2,643,629	$	—	$	3,614,670


	Amortized Cost or Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses Less Than 12 Months		Gross Unrealized Losses More Than 12 Months			Fair Value Hierarchy as of December 31, 2023						Aggregate Fair Value
									Level 1	Level 2		Level 3
Financial Assets:	(In thousands)
Cash and cash equivalents:
Money market funds	$	408,696	$	—	$	—	$	—		$	408,696	$	—	$	—	$	408,696


Total included in cash and cash equivalents	408,696		—		—		—			408,696		—		—		408,696
Marketable securities:
Debt securities:
U.S. Treasury securities	410,665		2,162		(7)		(1,665)			411,155		—		—		411,155
Non-U.S. government securities	83,576		55		(111)		(1,209)			82,311		—		—		82,311
Corporate debt securities and commercial paper	2,859,071		15,366		(10,818)		(5,922)			16,690		2,841,007		—		2,857,697
Total debt securities	3,353,312		17,583		(10,936)		(8,796)			510,156		2,841,007		—		3,351,163
Equity securities	4,901		—		—		—			4,901		—		—		4,901
Total marketable securities	3,358,213		17,583		(10,936)		(8,796)			515,057		2,841,007		—		3,356,064
Total financial assets	$	3,766,909	$	17,583	$	(10,936)	$	(8,796)		$	923,753	$	2,841,007	$	—	$	3,764,760

The Company’s primary objective when investing excess cash is preservation of capital, hence the Company’s debt securities primarily consist of U.S. Treasury Securities, non-U.S government securities, high credit quality corporate debt securities and commercial paper. Because the Company views its debt securities as available to support current operations, it has classified all available for sale securities as short-term.

Interest earned on debt securities was $27.2 million and $17.2 million in the three months ended March 31, 2024 and 2023, respectively. The interest is recorded as other income, net, in the accompanying condensed consolidated statements of operations.

The following table summarizes the contractual maturities of debt securities:


	As of March 31,				As of December 31,
	2024				2023
	Amortized Cost		Aggregate Fair Value		Amortized Cost		Aggregate Fair Value
Financial Assets:	(In thousands)
Less than one year	$	1,092,477	$	1,085,126	$	1,448,256	$	1,434,149
One to three years	2,064,936		2,064,944		1,905,056		1,917,014
Total	$	3,157,413	$	3,150,070	$	3,353,312	$	3,351,163

Strategic Investments

As of March 31, 2024 and December 31, 2023, the Company held strategic investments with a carrying value of $31.1 million and $30.7 million, respectively, recorded as other long-term assets in the accompanying condensed consolidated balance sheets. The carrying value of these securities is determined under the measurement alternative on a non-recurring basis and adjusted for observable changes in fair value or impairment. There were no impairments or significant adjustments recorded in the three months ended March 31, 2024 related to these investments. During the three months ended March 31, 2023, the Company recorded an impairment loss of $46.2 million related to one of these investments in other expenses, net, in the accompanying condensed consolidated statement of operations.

Financial Liabilities

The Company’s financial liabilities that are measured at fair value on a recurring basis consist of foreign currency derivative liabilities and are classified as Level 2 financial instruments in the fair value hierarchy. As of March 31, 2024 and December 31, 2023, the aggregate fair value of these liabilities and the associated unrealized losses were not significant.

The Company’s financial liabilities that are not measured at fair value on a recurring basis are its Senior Notes due 2029 (“2029 Notes”) and its Senior Notes due 2031 (“2031 Notes”). As of March 31, 2024, the fair values of the 2029 Notes and 2031 Notes were $449.7 million and $437.1 million, respectively. As of December 31, 2023, the fair values of the 2029 Notes and 2031 Notes were $462.4 million and $452.3 million, respectively.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details